Air cargo/parcel shipping: FAA reauthorization gets another extension approved by the House

Earlier this week, the House of Representatives voted to extend the current authorization for federal aviation programs through December 31, 2010 in what would be the 16th extension voted by Congress since the authorization’s scheduled expiration date in 2007, according to the House Transportation and Infrastructure Committee.

Earlier this week, the House of Representatives voted to extend the current authorization for federal aviation programs through December 31, 2010 in what would be the 16th extension voted by Congress since the authorization’s scheduled expiration date in 2007, according to the House Transportation and Infrastructure Committee.

This extension will allow the House and Senate to continue to work out differences between their own versions of a new FAA reauthorization bill.

Included in the bill is language to improve pilot training and safety on commuter and regional airlines. And in House floor statement, James L. Oberstar, chair of the House Transportation and Infrastructure Committee said that aviation programs, taxes, and Airport and Airway Trust Fund expenditure authority will continue without interruption pending completion of long-term Federal Aviation Administration (FAA) reauthorization legislation with this extension.

As LM has previously reported, the House’s version of FAA Reauthorization contains a labor-related provision which has served as a bone of contention between parcel industry heavyweights FedEx and UPS. This issue was not directly referenced in the legislation extension, but it is clear that no immediate resolution is on the horizon.

The main issue between the outfits is based on a measure in the House version which calls for “express carrier employee protection” and has the potential to change the labor status for FedEx Express employees—except for pilots and aircraft maintenance workers— from Railway Labor Act (RLA) to the National Labor Relations Act, which applies to UPS employees. And as LM has previously reported, if this bill is signed into law, many industry experts contend that it will make it less challenging for the Teamsters Union to organize FedEx Express workers.

In the House version, an amendment-which was included by Representative James L. Oberstar (D-Minn.)-would amend the RLA to clarify that employees of an “express carrier” shall only be covered by the RLA if they are employed in a position that is eligible for certification under FAA’s rules such as mechanics or pilots, and they are actually performing that type of work for the express carrier. It added that all other express carriers would be governed by the NLRA. The Senate version of this bill does not include this amendment.

Since this amendment was first introduced, FedEx has steadily maintained that this amendment is essentially a bailout for UPS.

And in literature for its campaign entitled BrownBailout.com, FedEx says that this amendment would force FedEx Express to operate under a law not designed for airlines and express companies. FedEx has previously defended its position by explaining that UPS and FedEx are “fundamentally different companies,” with UPS shipping 85 percent of its parcels on the ground, and FedEx primarily functioning as an airline, flying 85 percent of its packages in the air.

“FedEx has long supported the important air safety legislation which Congress has now passed,” said FedEx Director of Communications Maury Lane. “We also support Congress’ effort to pass a broad Reauthorization bill, without extraneous labor provisions, after the summer recess.”

And in a statement issued this week UPS officials said the company has long supported passage of this legislation without the “Brown Bailout” so it can begin improving airports and next generation navigational systems.

“Unfortunately, when Congress returns in November for its lame-duck session, we expect that UPS and Chairman Jim Oberstar will continue to push for this 230-word anticompetitive provision that benefits only UPS, at the expense of consumers and FedExExpress,” read the FedEx statement. “The Senate has already made it clear the UPS bailout cannot pass in the Senate and in March voted 93-0 to approve the FAA bill without the bailout provision.”

In a recent interview with LM, Lane said that this bill could be in legislative quicksand and added that it is unclear why Oberstar continues to push so hard for this amendment, saying it creates an unlevel playing field for FedEx and its ability to compete in the marketplace fairly.

UPS spokesman Norman Black said in a previous interview that is not the case, explaining that drivers at every transportation company in America—except one—are covered by the same law.

September 24, 2010

About the Author

Jeff Berman, Group News Editor

Jeff Berman is Group News Editor for Logistics Management, Modern Materials Handling, and Supply Chain Management Review. Jeff works and lives in Cape Elizabeth, Maine, where he covers all aspects of the supply chain, logistics, freight transportation, and materials handling sectors on a daily basis. Contact Jeff Berman

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